Gov’t budget deficit shrinks as spending slows

The Bureau of the Treasury reported that the national government’s budget deficit declined in November largely due to decreased public spending.

The Marcos administration’s fiscal gap amounted to P93.3 billion last month, a  25 percent reduction from the P123.9 billion recorded in the same month last year.

The contraction was “due to the 2.82 percent growth in revenue collection alongside a 4.69 percent contraction in public spending,” the treasury said.

Total revenues reached P340.4 billion, surpassing the P331.1 billion recorded a year ago.

Of that amount, tax revenues fell by nine percent to P286 billion from P314 billion.

The Bureau of Internal Revenue reported that its collection decrease to P210.2 billion from P237.1 billion in the previous year due to the shift in the value-added tax (VAT) remittance deadline.

Likewise, collections of the Bureau of Customs (BOC) slowed to P73.7 billion, or three percent lower compared to P75.7 billion a year earlier.

On the other hand, non-tax revenue offset the decline in tax collection after surged from P17.1 billion in November last year to P54.4 billion.

The treasury’s income soared to P41.5 billion from a mere P5.3 billion last year, primarily driven by higher dividend remittances and shares from the Philippine Amusement and Gaming Corp.’s income.

Meanwhile, government expenditures decreased by five percent from P455 billion to P433.6 billion in November.

The treasury said the sluggish spending was partially attributed to the reduced National Tax Allotment shares of local government units and lower direct payments made by development partners for foreign-assisted rail transport projects.

Furthermore, the Treasury added that the varying timing or schedule of major disbursements in the Department of Public Works and Highways and the Department of Social Welfare and Development also contributed to the weakened expenditures.

Excluding interest payments, the government recorded a P44.7 billion primary deficit in November, a decrease from P97.8 billion the previous year.

As a result of the November budget deficit, the government’s fiscal gap for the first 11 months fell by 10 percent to P1.111 trillion from P1.235 trillion in the same period last year.

Total expenditures at the end of November increased by four percent to P4.675 trillion from P4.513 trillion.

Conversely, revenues grew by nine percent from P3.277 trillion to P3.564 trillion. — Chino S. Leyco